Today we'll talk about Reliance's most popular app, JioMart JioMart is an E-Commerce platform which was launched in April this year and within one month they have started their service in more than 200 Indian cities. E-Commerce platform means that now you can, like Flipkart and Amazon, can sit home and do your shopping. Let's now discuss about it's business model. JioMart's model is said to be O2O, which means Online to Offline business model.
To understand this, let's take an example Assume that you have to order grocery for your home so you can visit JioMart app and select your grocery items and then place your order. That order, instead of going to JioMart's warehouse is placed to your nearest grocery (kirana) store. Now understand this carefully You placed your order through internet, that is when you were online and that order is placed to your nearest grocery (kirana) store which is an offline or a physical store. That is why it is called Online to Offline business model. Now to better understand JioMart's business let's first understand about Jio and Facebook deal. So as you would already know that recently Facebook invested about $5.7 Billion USD for 10% stake in Reliance.
The most important reason behind this deal was to give a tough fight to Flipkart and Amazon in India by launching a new E-Commerce platform. And now we are expecting that Whatsapp and JioMart will soon become a new E-Commerce platform Now you'll also be able to shop your favorite items from Whatsapp. Now let's discuss how this deal has benefited both the companies. First There are about 400 Million Indians using Whatsapp everyday but how much has Facebook earned from Whatsapp? Nothing. Zero. Soon Whatsapp will become a new income source for Facebook As soon as Whatsapp and JioMart connect together to become a new E-Commerce platform people will start with their shopping. and from each sale, Whatsapp will charge a commission from the respective seller.
So, in this way the total sales on Whatsapp and their commission will become the new income source. Second reason is that Facebook is a cash rich company which means it has a lot of money to invest and it has chosen Reliance as an investment option As we know that Reliance is biggest telecom company in India and now with JioMart they want to bring the local grocery (kirana) stores online. Let's now understand how this deal will benefit Reliance Reliance with it's JioMart brand has registered several local grocery (kirana) stores and delivery boys which means their on-field job is complete. and now by connecting with Whatsapp it will get an audience of 400 Million people. To establish Jio' reliance had taken a huge loan and the $5.7 Billion USD from this deal will be used to reduce it's debt. So, we had an overview of benefits from this deal to both the companies and soon we'll see Whatsapp in a new version where you'll be able to do your online shopping, order food, book your movie tickets, order Uber Everything and this will become India's new super app.